Gov. Butch Otter will decide over the next several days whether to repeal Idaho’s sales tax on groceries, and it’s important for Idahoans to ask him to repeal it. Otter’s decision will be a defining moment of his long political career, but, more importantly, it will be a defining moment for Idahoans who struggle to make ends meet and scrimp and save every penny to put food on the table.
According to polls, repealing the tax on groceries is one of the most popular policy ideas in Idaho, winning support by upwards of two thirds of the state’s voters, Republicans and Democrats, conservatives and liberals. Republican Sen. Cliff Bayer’s amended House Bill 67 to repeal the tax on groceries passed the House and Senate with bipartisan support and by wide margins.
It’s unclear what Otter will do. Though Otter issued a stern written rebuke of the grocery tax repeal, the governor didn’t expressly say he’d veto the measure. I figure he hoped his strong message would prompt the Legislature to stop the bill from reaching his desk. But Otter could sign the bill or allow it to become law without his signature. A veto is also possible.
The grocery tax is one of the state’s worst taxes. First, it requires Idahoans to pay taxes on the very thing they need to survive: food. Those of us not on government assistance programs pay the state 6 cents for each dollar spent at the grocery store. Does this money go to state government programs? Does it fund schools? Does it pay for police or prisons? Parks or highways? No.
In fact, the state government collects your money and stores it at the state Tax Commission. The Tax Commission then returns your money to you (or some portion thereof) when you file your income tax forms and claim the grocery tax credit. The credit is $100 per person, or $120 for the elderly. Think of it like a Christmas Club account, where the state saves your money and returns it to you just in time for, um, Easter, I guess.
However, unlike your Christmas Club account, there’s a very real possibility you’ll end up with less money than when you started. A family of four that spends about $600 a month on groceries will have $36 a month, or $432 a year, taken from it and handed to government accountants. The state’s Christmas Club program will reward this family of four with $400 via the grocery tax credit — or $32 less than they paid in. Clever, state government!
Bayer’s grocery tax repeal would also get rid of the grocery tax credit, which has an important benefit: People who buy food using federal government assistance like Food Stamps or WIC get their groceries without having to pay sales taxes. When those individuals file their income tax returns, they’re not supposed to claim the grocery tax credit, but they often do, and state tax officials and state welfare program administrators don’t talk to one another to make sure tax filers aren’t cheating the system.
Hopefully, Otter will do the right thing. He can be the governor who repealed Idaho’s awful sales tax on groceries. He can save every Idahoan money at the grocery checkout line. Or, he can be the governor who helped sustain the state’s troublesome tax policy. The choice is his.
Help Gov. Otter make the right decision, write him at email@example.com or call 208-334-2100. You can also send a video or audio message to the governor using IFF’s Testifi app, downloadable to mobile devices via Google Play Store or Apple’s App store. Tell Otter to support repealing the sales tax on groceries.
Wayne Hoffman helms the Idaho Freedom Foundation.